Two Steves (Forbes and Moore) asked for flat taxes again on New Year’s Eve wall street journal editorial. They were right, but the title said it all. “Trump’s tax cuts were good. A flat tax would be better.” A flat tax is much better than current law, but it could be even better.

The Khor-Rabushka flat tax has existed for decades. Slowly but surely, proponents are winning the argument. Federal income tax rates have become flatter, and the tax base has steadily moved toward economic neutrality, especially with regard to taxing savings and investments. (Related: Richard Stout: How to reform the ‘politically weaponized’ FBI and restore public trust)

Similarly, with the addition of Iowa and Louisiana, Currently, 16 states have a single-rate income tax. A further eight are subject to the ultimate flat rate tax, with no income tax at all.

This progress is encouraging, and both Steves are right that going all-in on a federal flat tax would be great. However, while the flat tax has many benefits, we have learned a few things since the flat tax was first proposed. It turns out that a unified flat tax for individuals is even better.

To understand this problem, assume we adopt a federal flat tax. This essentially means taxing all labor income at a single rate, except for savings and earnings from savings at the individual level. Simply put, it’s a payroll tax.

That’s wonderful. The three payroll taxes now operate in parallel. New payroll taxes and flat rate taxes will be added. We have a federal insurance contribution law (FICA) Financing Social Security and Medicare through payroll taxes. And then there is the federal unemployment insurance law (lid) Payroll taxes that support the unemployment insurance system.

Why replace the current federal income tax with a flat tax just to add another federal payroll tax? We could do better.

The obvious solution is to replace the current three-tax federal government mess with a unified flat tax. A unified flat tax would be a single federal payroll tax with dedicated collections for FUTA, FICA and funding for the rest of the federal government, resulting in a single, economically neutral flat tax . .

To really do this correctly, you also need to factor in the “employer’s share” of FICA payroll taxes. Employers collect and remit taxes, while workers pay taxes as an apparent reduction in wages. This will improve the transparency of the tax system, as few employees are aware that they are paying huge amounts of invisible tax.

A unified flat tax would greatly increase transparency by allowing taxpayers to see in one calculation the total amount of personal tax they pay to the federal government. Few workers know how much FICA and FUTA they pay each year, let alone the portion their employer collects on their behalf. Under the unified flat tax, it’s there in all its painful glory.

The tax base for unified fixed tax is the same as the old fixed tax for individuals and corporations, and there is a single tax rate like fixed tax. It therefore provides all the benefits of a flat tax, plus further simplification and greater transparency.

The journey toward a sensible and fully transparent tax system began with the 1964 tax system. kennedy tax cutsthen received a major boost in 1981. reagan tax cuts. It continued with the 2001 and 2003 Bush tax cuts, and received an even bigger boost with the 2017 Trump tax cuts.

It’s been a long road. Let’s continue our journey.

To get the most benefits, make your destination a flat rate tax.

J.D. Foster is the former Chief Economist of the Office of Management and Budget and the former Chief Economist and Executive Vice Chairman of the U.S. Chamber of Commerce. He now lives relatively freely in the hills of Idaho.

The views and opinions expressed in this commentary are those of the author and do not reflect the official position of the Daily Caller News Foundation.

All content produced by the Daily Caller News Foundation, an independent, nonpartisan news distribution service, is available free of charge to legitimate news publishers with large audiences. All republished articles must include our logo, reporter byline, and DCNF affiliation. If you have any questions about our guidelines or our partnership, please contact us at licensing@dailycallernewsfoundation.org.